Kansas judges satisfied on equity issue of school funding

06/11/2014 4:33 PM

08/08/2014 10:24 AM

A three-judge panel found that the Legislature had satisfied a Supreme Court order to make school funding more equitable at a hearing Wednesday.

The Supreme Court ruled in March that gaps between school districts in funding were unconstitutional. It ordered the Legislature to come up with a solution before July 1. The Legislature passed a bill in April that puts $129 million toward addressing the gaps.

Gannon v. State of Kansas will now move on to the bigger question of whether school funding is adequate. The judges have not yet decided whether to rely on previously presented evidence or to hold a new trial to answer this question.

“This was a preliminary deal. And now it’s on to the full meal deal. It’s off to the adequacy thing, which is why we filed the lawsuit in the first place,” said John Robb, an attorney for the plaintiffs’ group Schools for Fair Funding.

The panel’s decision to accept lawmakers’ solution on equity means that there will be no need for a special session and that school districts can count on receiving their local option budget funds on July 1 at the start of the new fiscal year.

In Wichita, the school district expects to receive $1.7 million more in local option budget dollars, which are drawn from local property taxes. Far more money — more than $11 million — will go to property tax relief.

The district also will receive $3.5 million to put toward capital improvement of school facilities.

Arthur Chalmers, a lawyer representing the state, pointed to the Wichita funding as proof the Legislature had fully addressed inequity.

“I think what the Legislature deserves is a pat on the back,” Chalmers said.

However, the court did not dismiss the equity party of the ongoing school finance case, as the state’s lawyers had asked. The judges just said they would “take no further action” at this time.

And advocates for schools said they were concerned that the fix for equity would create new inequities in the future.

Robb said keeping the case open will allow school districts to hold the Legislature accountable in the future.

Senate Vice President Jeff King, R-Independence, a lawyer who represented the state in a previous school finance case, said he was happy with the judges’ decision to let the Legislature’s solution stand.

“It’s obviously great news that the three judge panel recognized what we’ve known all along, and that’s the Legislature has solved any equity concerns in school funding,” he said in a phone call.

Gannon v. State of Kansas will now move on to the bigger question of whether school funding is adequate. The judges have not yet decided whether to rely on previously presented evidence or to hold a new trial to answer this question.

“This was a preliminary deal. And now it’s on to the full meal deal. It’s off to the adequacy thing, which is why we filed the lawsuit in the first place,” Robb said.

The bill contained several controversial policy changes, including an elimination of state-mandated hearings before a public school teacher’s contract can be terminated. The Kansas National Education Association, the state’s largest teachers union, announced plans to sue over this and other policies in the bill.

Judge Franklin Theis said the bill has a clause saying if other portions of the law are found unconstitutional, the funding will be left intact.

The bill made a number of changes to the school funding formula. The Wichita school district stands to lose more than $1 million from cuts to funding for at-risk and nonproficient students, offsetting a $1 million increase to its base aid.

Property owners in the Wichita district stand to receive more than $11 million in property tax relief, based on estimates from Kansas Department of Education.

Dale Dennis, the deputy commissioner of education, explained on the witness stand that money from the state will be used to replace money that now comes out of local taxpayers’ wallets.

Schools for Fair Funding contended that the Legislature had successfully complied with the statute, but that those statutes do not fully address inequity.

School districts now are capped at 30 percent of funding from local option budgets, unless voters approve more. Fourteen districts have voter permission to get 31 percent of their funding from LOB. The law would allow those 14 districts to increase that percentage to 33 without another election. Other districts, including Wichita, would need to ask voters to increase their LOB.

“The poorer district you have, property wealth, the harder it is” to get approval in such elections, argued Alan Rupe, an attorney for the plaintiffs.

Diane Gjerstad, the lobbyist for the Wichita school district, attended the hearing and said during a recess that she expects the gaps between districts to widen.

She also noted that the overall cuts to at-risk funding, which primarily benefited high poverty districts like Wichita, amounted to more than $3.4 million. At the same time, the state estimates $5 million will be needed to cover the cost of districts increasing their LOB percentage.

“A few districts with really high risk kids lost (funding) while the wealthy districts gained about $5 million in state aid. That struck me. I hadn’t seen that number before,” she said.

Theis had scrutinized the cuts to at-risk and nonproficient funding during the hearing, asking whether they had “fallen out of the sky.” But in the end neither he, nor Judges Robert Fleming and Jack Burr, said the change affected the question of equity enough to throw out the law or halt its implementation.

Stephen McAllister, an attorney for the state, asked the judges to clarify whether their decision to take no further action and in effect accept the Legislature’s solution meant they had dismissed the equity question. But the judges said that they were exercising their power to do nothing.

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